Purchasing activity
Operators with location contracts
Phonos
Pins
Videos
More
19%
10%
93%
Same
26%
11%
5%
Less
55%
79%
2%
other amounts of commission splits,
the most common of these being a 55
percent share for the operator.
Also on the subject of location
relations, 19 percent of the operators
said they deal with location loans.
But the tendency of tying up capital
in this manner is clearly the way of
·the older, larger operators . Forty
percent of the operators in the
largest classification operating more
than 300 games made loans to
locations in 1981. Twenty -three
percent of the operators in the 76-
299 machine category and only nine
percent of the smallest group of
operators said they made location
loans.
With all the capital that operators
have tied up in purchasing new
equipment, Play Meter polled
the operators to see what kinds of
assurances they had that their
locations would remain intact.
Nationally , 45 percent of the
operators said they do not work with
location contracts, and another 40
percent said they work with
contracts with only some of their
locations. Fifteen percent said they
have contracts with all of their
locations.
However , there may be some sort
of counterbalance, some sort of give-
and-take between location loans and
location contracts. This is shown in
that larger operators, who showed a
greater tendency to make location
loans, also revealed that for the most
part they had binding contracts with
their locations. In fact , only eight
percent of the operators in the
largest machine classification said
they did not work with any location
contracts.
Potpourri
In a potpourri of other responses
received from operators nationwide,
the survey found that 77 percent of
all operators reported they had
experienced an increase in profits in
1981. Ten percent said their profits
had remained the same, and 13
percent reported a decline in their
PLAY METER, November 15, 1981
None
Some
All
75-under
59%
28%
13%
76-299
45%
41%
14%
300-over
8%
69%
23%
Nat'l avg.
45%
40%
15%
profits in 1981.
Sixteen percent of the responding
operators said they use a computer
to keep track of their operations.
Fifty-seven percent of those who
operate phonographs said they
operate more than one brand of
phonograph, and they said they
change an average of 3.36 records
per week per phonograph.
Thirteen percent said they have
some of their videos on fifty -cent
play, and 11 percent said they have
some of their pinballs on four-bit
play.
Industry issues
Convertible games , which
recently came into prominence in
the industry, got a solid approval
rating from responding operators-
with 56 percent saying they favored
convertible games, 32 percent
expressing no opinion, and 12 saying
they disapproved . High games prices
and a growing feeling among
operators that factories are
"gouging" them on new equipment
prices were cited as the major
reasons for favoring the convertible
games concept.
Those who disapproved or who
expressed no opinion stated some
doubts about the earning potential of
convertible games. Many who
disapporved said they felt the games
would be mediocre, that the systems
would limit the adaptability of the
games, and they also expressed a
broad-based fear that the factories
would then be in a position to sell
their games direct to the locations,
bypassing even the operators.
Video gambling games, which
have acquired the moniker of "gray
area" games, also came into
prominence earlier this year when
several operator assocations and
game factories took stands against
the operation of the machines on the
grounds that they would create an
adverse governmental climate for
legitimate pure amusement games. Of
those responding to the Play Meter
survey, only nine percent said they
operated such equipment. The
remaining 91 percent said they did
not operate gray area games.
Video games have brought about
new copyright problems for
operators to contend with. In 1981,
factories stepped up their copyright
infringement cases by seeking to
impound video copies operators had
bought. Of those responding to the
Play Meter survey, 15 percent of
the operators said they had
knowingly bought unauthorized
copies of video games. Six percent
said they did not know if they had,
and 79 percent claimed they did not.
On the other copyright front,
operators' opinion of the compul-
sory jukebox copyright law took a
decidedly negative turn in early 1981
when it was learned that operators
will be required to pay $25 in
royalties per jukebox and that that
will increase to $50 per jukebox in
1984.
The furor operators had held
toward the concessions made by
their national association, AMOA, in
agreeing to the per-jukebox fee in the
first place, was also reflected in the
survey findings. When asked if at this
point they favor a move to repeal the
per-jukebox copyright assessment,
63 percent of the AMOA members
responding said they now favor an
all-out assault on the law in
Congress. The most cited reason
was that operators believe they are
now being doubly assessed with
copyright royalties since they also
pay music copyrights when they
purchase the records. Among non-
AMOA members, there was an 80
percent opinion in favor of trying to
get the law repealed.
Those who favor efforts to hold
the line with regard to future per-
jukebox assessments rather than a
fight to repeal the adverse legislation
were clearly in the minority. For
the most part, those in the minority
stated they opposed any efforts for a
repeal because they now saw the
jukebox copyright battle as lost. "We
should move on to other things," one
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